Compaq also said it completed a $1.6 billion tender offer for shares of e-commerce site Shopping.com, which features local stores in the top 50 metro areas.

"With Zip2's industry leading platform and media company partnerships, AltaVista intends to deliver the most robust platform for localized information and e-commerce on the Internet," Compaq said in a statement.

Shares of Compaq rose in the morning only to end the day down 1/8 to 42 7/8 as Wall Street's tech rally sputtered. See Market Snapshot

Oasis

"Our belief is that the best Internet computing experience must include a local 'Internet Oasis' where consumers can access deep local information about activities and shopping possibilities right in their own backyards," AltaVista President and CEO Rod Schrock, President said in a statement. "Zip2's advanced technology and strategic relationships with media companies will make AltaVista much more powerful and useful to the local user." Zip2 develops, hosts and maintains consumer Web sites specifically for media companies including the Mirror Group, Classified Ventures, The New York Times, Knight Ridder, Morris Communications, and newspapers in the Hearst, Times Mirror, Media General, and Pulitzer Publishing chains.

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